Terminal disease

The provincial government claims to have a plan to reduce video lottery terminal addiction. But when the King’s College Investigative Workshop looked into the reality of VLT use, they found the government’s plan is mostly window dressing.

Brenda Hurlbert left her father's funeral in New Brunswick with a few of his most prized possessions.

Hurlbert sat down at a video lottery terminal on the Digby ferry headed back to her home just outside Yarmouth.

It wasn't long before she'd blown through all of her money---all but a coin collection willed to her children by their recently deceased grandfather.

She just needed one more row of cherries to launch into the $100 bonus round.

After agonizing over it, she ripped the package open and inserted the gleaming coins into the slot.

"My thought was, 'OK, I can get another one and put it back.' The kids won't really know. Yeah, I could have got another coin collection and put it back," she says. "That wasn't the point. The point was he collected every single one of them for my kids. And I gambled it."

She's taken money from her employers and even sold the family dog, all in the name of VLTs.

"I just hit such a low, I just felt like I was being swallowed up by this big black tornado just sucking me down."

Eventually, she told her counsellor it would be easier to die than go on. Hurlbert is part of the one percent of the population who are problem gamblers and play VLTs regularly---a measly number of people that account for as much as half of the VLT revenues in Nova Scotia, according to government studies.

That's as much as $100 million lost by problem VLT players in bars, clubs and on First Nations reserves.

Despite an array of measures to promote "responsible gambling" in the province, steps to rein the highly addictive machines have been modest at best. An investigation by University of King's College journalism students has revealed a gambling industry in Nova Scotia that, despite all the government policy and public outcry, continues to be responsible for widespread devastation in the lives of Nova Scotians.

Five years after the provincial government trumpeted a strategy for gambling in the province, video lottery terminals continue to lure in new addicts, driving people into despair, bankruptcy and crime.

Measures that were supposed to put a lid on the electronic gambling machines have had limited impact, with total net revenues from all VLTs in Nova Scotia nearing $200 million last year, an increase of $14 million from 2007/2008. The amount fed into the machines by gamblers is even higher, nearing a billion dollars before prizes.

A billion dollars is about the same amount as the province makes exporting seafood, or about twice what farmers get for sales of agricultural products.

In 2005, premier Darrell Dexter, the leader of the opposition at the time, introduced a private member's bill that would have required a binding referendum on VLTs. The bill was never debated.

Asked Wednesday about why his government hasn't moved on a referendum, Dexter said the "mosaic of gambling" has changed because of online gambling. "If you get rid of [VLTs], you drive [the problems] either underground or online."

Since being elected, his government has allowed the previous gaming strategy to expire and, last week, killed a study on the socio-economic impacts of gambling ordered by the previous Tory government.

A once-rigorous regulatory regime, supposed to continuously study gambling, has been almost completely dismantled. Beginning in 1995, the then Alcohol and Gaming Authority produced inch-thick annual reviews of gambling. The detailed analyses covered everything from the social, health and justice impacts of gambling among suggestions to improve gaming in Nova Scotia.

These have since shrunk to brief 30-page statistical documents.

And there is a growing view that the gambling strategy was largely a public relations exercise by a government and government-owned gaming corporation that do not want to give up the enormous revenues that flow into the provincial treasury from VLTs.

The crack cocaine of gamblingThe government's own studies show just how addictive VLTs really are.

The 2007 Adult Gambling Prevalence Study found that 26 percent of regular VLT players reported having problems, an increase of 67 percent from the 16 percent reported in 2003.

The study showed that VLTs "continue to be cited as the principle source of gambling problems."

"Can you imagine," asks Bruce Dienes, a psychology professor at Mount Saint Vincent University, "if you were selling a car, where 25 per cent of the regular drivers got in an accident, how long would you be permitted to sell that car?

"There's just a sense of outrage that a government that is supposed to---that has the mandate to protect its citizens---is putting them at risk and they're doing it in a way which is privately deceptive."

The prevalence study revealed that since implementing a five-year gaming strategy in 2005, fewer people are playing VLTs, but those remaining are spending more money and having more problems.

And Hurlbert can vouch for that.

"It'll strip you down as quick as crack cocaine, if not faster," Hurlbert warns, staring off into the distance, reflecting upon her addiction.

In Nova Scotia, there were 2,241 VLTS located in bars and legions as of December 31, according to the Atlantic Lottery Corporation, and almost 600 more on reserves, according to the province.

Kevin Harrigan, a research associate who has studied VLTs extensively at the University of Waterloo, says VLTs are unlike any other form of gambling---almost all aspects of the game are concealed to the player.

He says the number of symbols per reel is hidden from the player. Contrary to roulette or poker, players have no idea what their odds are of winning a game.

In Nova Scotia, the odds of winning the top prize must be greater than one in 17 million, according to the Atlantic Lottery Corporation's product specifications.

You're 22 times more likely to be struck by lightning.

Wins are completely random. All outcomes are produced by a random number generator that is generating tens of thousands of numbers per second even when the machine is idle.

So you can rid yourself of those myths about your machine being due for a win. You're wrong. The government only requires that the machines pay out as winnings at least 80 percent of what is wagered. Kerry Chambers, a professor of sociology at Dalhousie University, who once worked for the old Alcohol and Gaming Authority, says it's basic psychology.

"It's like the rat that goes and gets food all the time, but it's random," says Chambers, who now studies gambling. "So when you take the food they still punch the button because they think they're going to get food. It's the same with a VLT player. They win and because it's random they begin to think that there is a pattern and they keep playing."

Wreaking havocWayne Power awoke one morning to find the billfold of his wallet was missing something---a lot of something.

"I knew I had a couple thousand dollars on me the day before when I went out, and I woke up the next morning, I had none left."

Power, like most who have problems, says his addiction was ignited by a roll of quarters and a curiosity for the machines. He says he found the game to be largely a social activity. More than $15,000 later, VLTs weren't so fun anymore.

Today, Power sits at his kitchen table in New Waterford, casually drinking a rum and Coke from a travel mug in a home he once shared with his wife---now his ex-wife.

He's not the only Caper mesmerized by the spinning reels and the rush of a win. Cape Breton has the some of the highest rates of people playing VLTs in the province, according to the 2007 prevalence study.

He's also swimming in a pool of VLTs.

Altogether, Cape Breton County has almost 500 VLTs, plus 300 similar slot machines at the Sydney casino.

And an analysis by King's College students of figures provided by ALC shows there was a 14 percent increase in non-reserve VLT revenues from 2007 to 2009 in Cape Breton County. The increase in New Waterford was even greater---26 percent.

It's a similar story in HRM: Using neighbourhood income figures provided by Statistics Canada, combined with the locations of VLTs provided by the Alcohol and Gaming Division, the King's College investigative team found there are four times more VLTs per capita in the poorest areas than in the richest neighbourhoods.

Like many others, Power found himself scraping the walls of the debt pit in bankruptcy court. VLT players produce a steady stream of people becoming addicted, falling into bankruptcy and going to court charged with criminal offences.

Joseph Wilkie, a financial trustee at WBLI in Bedford, says his firm regularly sees cases of bankruptcy-by-gambling, with the majority being VLT-related. He says the number is probably much larger as clients don't necessarily have to reveal that gambling was involved.

In February, an armed forces veteran and volunteer legion treasurer was sentenced to 18 months' house arrest for stealing $70,000 from the Westmount Royal Canadian Legion branch in the Sydney area, to have money to play the VLTs there.

Judge David J. Ryan heard the case. Ryan says he can't comment on any specific case, but when asked about the problem in general, he said he sees six to 12 cases a year in his Sydney court where gambling led to crime such as theft or family violence.

"I would say the vast majority is the VLTs. I think there's a perception that I have and that I think most judges are aware, that there are people out there with serious gambling issues, perhaps more so than we realize. We see the results of it perhaps more than most people do."

LoopholesPerched in Indian Brook, Nova Scotia, is a small reserve community's gas bar. Inside is a dark room stocked full of VLTs next to a bathroom with a toilet that can only be flushed with the assistance of a plastic spoon. Willy Gehue, a self-declared gambling addict, has been there often.

"At one time I was seriously addicted," says Gehue. "I see myself a couple of times there---quite a few times---one day put in $200, next day put $300 in, next day put another $200 in; like it was 20 or 30 bucks."

While the previous government acted to turn off machines in bars, clubs and legions between midnight and closing, and removed 1,000 machines from those locations, explosive growth in loosely regulated reserve gambling has erased many of the gains.

Led by urban reserves in Sydney and Cole Harbour that draw hordes of non-native gamblers, revenues from reserve VLTs now account for one in four dollars collected from VLTs in Nova Scotia. Rather than dropping money at their local taverns, people in Halifax are driving to Cole Harbour, where unlike the VLTs elsewhere, those on reserves can often operate 23 hours a day, don't have to be in licensed premises, allow smoking in some cases, and can oftentimes offer a safe place where addicts are unlikely to see their neighbours.

The reserve machines operate under secret agreements with the province and are subject to almost no provincial oversight despite the fact that most of the money comes from non-natives. The King's investigative team asked the government and all the bands to look at the agreements; government officials refused to turn them over and not a single band replied.

According to Lloyd Johnson, a member of the gaming commission at Millbrook, until 1995 reserves were only allowed to sell baskets alongside the highway. They've come a long way from roadside sales. VLT revenues from reserves, after fees paid to ALC, have jumped from $10.7 million to $49 million in the past 11 years.

But most of the revenues generated go directly back to the band to fund community development.

"A lot of them use it for programs that are not funded through Indian and Northern Affairs. They use it to supplement health care, youth programs, community service programs," says Nancy McInnis Leek, trade adviser for the Department of Intergovernmental Affairs.

For example, Membertou First Nation, which has almost as many VLTs as the rest of Sydney, has developed a state-of-the-art convention centre, built houses and roads and provided annual dividends of $1,500 to each band member.

At Millbrook First Nation in Cole Harbour, a vast number of people from off-reserve communities travel to places such as Treaty Gas to play one of their VLTs whenever the mood strikes.

In 2002, the reserve brought in $7.8 million in revenue for community development, allowing the construction of a 100-room hotel complete with indoor water park. Construction is scheduled to start next month.

"We really don't like to brag about the money part of [VLT machines] because there are segments of society that say, 'Yeah you know they're lining their pockets,' and the anti-gaming crowd would say, 'Oh yeah, they made it on the backs of problem gamblers.' We don't look at it that way," says Johnson.

He says the community has improved dramatically since 1994---a direct result of the VLT revenue.

But is that dissenting "segment of society" right? Does the deal to allow VLTs on reserves, made to help native communities, do so on the backs of problem gamblers and their grocery money?

VLTs on reserves can be found at gas stations, laundromats and convenience stores and many are open 23 hours a day, while off-reserve, only bars and legions have VLTs, and they must turn them off at midnight.

The reserve VLT industry has become so big that even the Nova Scotia Gaming Corporation has taken notice. "Revenues from [VLTs] performed under target as a result of a shift in play to First Nations' sites," NSGC said in its annual business plan for 2008-2009. "Some customers prefer First Nations' sites due to differences in the operating environment: NSGC's sites do not permit smoking, and VLT operations end at midnight each day; First Nations' sites permit smoking and allow VLTs to operate past midnight."

The huge flow of money to reserves directly undermines the government's gaming strategy, particularly because of the longer operating hours. One of the reasons the government shut down VLTs off-reserve after midnight was because a higher proportion of players in the early morning hours are problem gamblers.

On many occasions, Hurlbert found herself contemplating her next move after her favourite bar shut off the lights.

"Then I ended up going to the reserve. And that's the most accommodating place I've ever seen in my entire life," she explains, referring to Acadia's Yarmouth reserve. "Because they would make it very important to be nice to you. And I was considered a very good customer."

SpinAll this comes despite the much-heralded 2005 gambling strategy and the high-profile move to remove 1,000 VLTs, slow the play and close VLTs after midnight. Hurlbert didn't even notice the changes. "It didn't make a difference," she says. "Didn't matter to me a bit."

Peter McKenna, a political science professor at the University of Prince Edward Island and author of Terminal Damage, a book on VLTs in Atlantic Canada, says the strategy is nothing more than a PR gimmick.

"It's all about convincing voters that the government is seized with the issue when in fact they are crossing from it, and what they want to do is neutralize any criticism," says McKenna. The strategy makes "absolutely no sense."

"Because governments, in order to profit from gambling must---have to, it's a necessity---they have to create addicts," he says. "They have to create people with problems with gambling. Because those are the people who provide the lion's share of revenues.

"Because those are their best customers."

Carolyn Davison, director of addiction services in the Nova Scotia Department of Health doesn't go that far. She says the strategy has the right message but it didn't cure the addiction problem.

"If you wanted to know whether the gaming strategy had any impact on the rates of problem gambling, it didn't," says Davison.

We visited the Royal Canadian Legion Vimy 27 on Almon Street in Halifax where two people sit entranced at 11am tapping a spin button on a fluorescent screenamphlets promoting "responsible gaming" sit atop one VLT collecting dust---the stack is full. Nova Scotia Gaming Corporation spends about $7.5 million a year on programs to encourage people not to gamble beyond their means, and will soon roll out a system that requires VLT players to have an anonymous ID card before they can use the machines.

"This whole notion of responsible gambling pushes the person with problem gambling into a position of irresponsibility. So if you're gambling beyond your means you're being irresponsible. One of the reasons problem gamblers do not come forward is because of the stigma. You're being pushed into an irresponsible position that stigmatizes you further because you're stupid."

Debby Langille of Game Over VLTs, a local group against VLTs, says the so-called initiative is enough to make her sick.

"And we all know how to gamble in Nova Scotia 'cause we're all responsible," says Langille sarcastically. "That's part of their advertising and I wanna put my foot through the TV every time I hear it and every time I hear that song, 'Know when to hold 'em, know when to fold 'em'."

Last year, the Green Party called for the abolition of VLTs, citing statistics showing five per cent of financial problems in Nova Scotia are caused by gambling, as well as the social harm the machines cause.

In Newfoundland, the father of a VLT addict who died of a drug overdose in 2003 is trying to start a class-action suit against the Atlantic Lottery Corporation, blaming the machines for her death.

In his proposed statement of claim Keith Piercey alleges, "As a result of the deceptive nature of VLTs, addicted, pathological or problem gamblers have impaired control of gambling behaviour despite harmful consequences of their behaviour, and are fixated on the win they believe is due to them and which will solve their problems. Eventually, they just fixate on playing and wins become irrelevant. Pathological gamblers make up a disproportionally large share of the Defendant's VLT revenues from this province."

"Her death was a suicide caused by the addictive and deceptive nature of VLTs."

The class-action suit has not yet been certified by the court. The allegations are unproven and have not been tested in court.

Hurlbert has recovered, but there are many others still suffering from the wrath of VLTs. It's just like any other addiction, she says. The walls crumble around you and you're sent spinning into oblivion.

"I hate what it made me become. It stripped me of my identity, my self-esteem, my credibility, my honesty. As a person it rips you raw."

The King's College Investigative Workshop has collected more information on this issue, additional articles, maps, statistics and further investigations. See their work at gambling.kingsjournalism.com.

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